How to Avoid the Lines at Starbucks

09/27/2013 10:34 am ET
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Updated
Nov 27, 2013

Gene Marks
Small business management columnist, author, speaker, and business owner

The worst thing is waiting in line at Starbucks, right? Especially first thing in the morning. The line is always enormous. And there's always that guy in front of you ordering one of those complicated 800 calorie ice-cream/coffee drinks. And all you want is a quick cup. In the company's defense, it's not just Starbucks. It's the restaurant where you're waiting for your check. It's the pharmacy where you're standing in that endless line to pay for a tube of toothpaste. It's your favorite clothes store. Or any retail store.

You will soon be able to avoid those lines. Because a few weeks ago I saw the future. And it was with a guy from PayPal. The guy is Anuj Nayal. He's their fast-talking Director of Global Initiatives. I was in midtown New York doing an unrelated project for them and while there we talked about two major products they've launched that will impact mobile payments. PayPal is not compensating me to write this.

Actually, that's not entirely true. Anju did buy me a coffee and a blueberry muffin for my efforts. He insisted on going to a place all the way down in the Village though. Why? To show me the future of retail. He knows I love this stuff. So as the driver pulled away from the curb Anuj asked me what kind of coffee I wanted. No frappy-wappy-whippacinnos for me. I asked for a simple, plain cup of coffee, a little milk, a little sweetener. Anuj said "no problem," proudly pulled out his smartphone and launched PayPal's new app. And here's how it worked. Pay attention. This affects you.

The app already had a directory of thousands of retailers who had previously signed up for the service. One of those who signed up was a little coffee shop near Washington Square. He chose two cups of coffee from the menu and splurged for a couple of blueberry muffins. The entire order came to $72.35, which was about right for New York City. And then he paid for it. On his phone. From the car. How? He had setup his PayPal account (like everyone sets up their PayPal account) to access money from his bank account (or credit card). With the initial setup done, there was no more need for any more cards or cash. Going forward, all he needed was his phone. And when we arrived at the coffee shop, our two coffees and blueberry muffins were waiting for us to be picked up. Of course they were ice cold by that point because traffic in that city sucks. But at least we didn't have to wait in line!

And neither will you anymore. Because the next generation of mobile payment applications are upon us. It greatly affects you, the small retailer. And you, the consumer.

Google has been mightily struggling with their "Wallet" product. Dependent on Near Field Communication technology, the service requires retailers to buy separate units which need to be integrated with a point of sale system so that consumers can "tap" their phones to pay. But Google Wallet has not been catching on. There have been many reasons given. In my opinion, it's not just the technology. It's because one big thing is missing: we still have to wait in line! We still have to deal with surly store clerks and that one woman with the three toddlers who insists on paying with a check. We are not saving time. Our lives are not made much better by "tapping."

The next generation of mobile payment applications doesn't involve tapping. Instead, like many of the self-service tools you're seeing, these applications will eliminate some people from the process and the plastic credit cards that we are forced to carry. This is one step towards eliminating our wallets altogether. These applications will save us time. They are getting the sales clerks, waitresses, ticket-sellers and baristas out of our way. And they are making the really good sales people even better -- getting them out from behind the cash register and on the shop floor where they belong, assisting customers and taking orders. And in the process they are making retailers and other consumer driven businesses more profitable. They are reducing overheads and cutting payrolls. And it's all happening right now. Is your store doing this?

PayPal will have plenty of competition. Banks and credit card processing companies are developing similar technologies. Square and other mobile payment software developers are creating competing products. Ziosk and similar point of sales vendors are attaching tablets to restaurant tables across the country. All of these applications are slowly, but enormously, changing retail as we know it. Because now we can place our order and pay for it without ever speaking to a human being. We can buy things in advance and pick them up later. The retailer, if they're on their game, can offer coupons for special items and frequent customers. They can collect (with permission) customer data for future marketing and communications. And even the most junior salesperson can be prompted to suggest other accessories or add-ons for the product we're about to buy right there on the floor based on recommendations made by their mobile application.

There's the mobile app. But there's something else happening on your phone. It's called BLE or Bluetooth Low Energy. What's that? As you enter one of your favorite stores a very low energy Bluetooth "beacon" signal emanating from your phone alerts the store's point of sale system that you're there. BLE is now standard issue on the new iPhone and many Android devices.

How does this change your life? You choose and swipe a product's bar codes. Or the items already have embedded Radio Frequency ID chips that are readily scanned. When you go to check out the clerk already has your photo and payment information sent to it by BLE. So gets a verbal confirmation from you or asks for a fingerprint and from this ID-check you're authorized and a payment is made from your phone. Your phone never left your pocket. You have no credit cards. You've already told the application which stores are allowed to "check in" with you.

This is reality today. The just released PayPal Beacon uses BLE and already works with many major point of sale systems. The retailer only needs to purchase an inexpensive plug in device that will sense the BLE signal. PayPal is also offering a programming interface for developers to create more customized in-store solutions. The company is piloting this product in the fourth quarter of this year and plans a full rollout in 2014. And keep an eye out for Apple because they're got their own BLE service called iBeacon and it's included on the newly released iOS 7 operating system. Wait... doesn't Apple already store payment information for their millions of iTunes customers? Hmmm.

This is important stuff if you're in the retail business. And especially if you're a small retailer. You are looking for better ways to make your customers happy. You want to provide the highest level of service at the lowest cost possible. You want your customers to enjoy doing business with you because not only are your products great, but you're efficient and fast. You want to stand out from your competition and offer a better all-around experience. You want an easy way to offer promotions for drawing in new buyers. Will the transaction fees that PayPal, Square, Apple or other leading mobile payment application providers charge be worth all of this?

I hate carrying around a wallet. I hate fumbling with my credit cards. I hate waiting to pay my check at a busy restaurant. But most of all, I hate standing in line Starbucks. So it's worth it to me.